GM Reports 326,300 June Deliveries down 22 percent

[tgagneguam]

Originally Posted by throwback

Yes we can. As I have said many times GM is trying to sell 4 mid-size models to the same customer, Aura, Malibu, G6, Lacrosse. Honda and Toyota are selling one each. All of these GM models will not be successful, the market is just not that big.

Honda sells 350,000+ Accords to certain family sedan buyers who would never buy a Camry, Altima, or a Sonata. Toyota sells 450,000+ Camry's to people who would never buy an Altima or Accord. Nissan sells 250,000+ Altima's to people who would never buy a Camry, Accord, or Sonata. Hyundai sells 150,000 plus Sonata's to people who would never buy a Camry, Accord, or Altima. Funny, these folks are able to move well over a million units in an even larger market that includes hundreds of thousands of units moved through GM, Ford, and Chrysler Group channels.

If GM hadn't dropped the ball, if they designed their family sedans as well as foreign brands have done in some cases for the better part of two decades, GM very well could differentiate the Saturn Aura, the Chevrolet Malibu, the Pontiac G6, and the Buick LaCrosse and could be enjoying similar success. Already there are people who buy a Buick that wouldn't buy a Pontiac, there are folks who drive a Chevrolet who would never buy a Saturn. Differentiated where they need to be differentiated and commonized where they could be commonized, there's definitely a place for all four vehicles you mention to do well. In fact, I think GM could actually capitolize on economies of scale, again, if they had their act together.

Saying that they're failing because they're too many models comes across as a cop out to me; it excuses sub-par to average work.

[throwback]

Originally Posted by tgagneguam

And don't fool yourselves, folks: GM would be doing just as poorly with three brands as it is with eight. Hacking divisions isn't the only answer to its dilemma. In fact, having only three divisions, with lots of sales lost to the competition if GMC, Saab, Saturn and others were disintegrated (as Oldsmobile clearly demonstrated: little to no conquest sales), means less revenue stream to address gigantic(!) fixed costs.

Let's think out of the box for once, eh?

I don't disagree with your comments. I would add that GM needs to focus on profits and less on sales. They are losing money, perhaps a smaller GM would actually make money by making even better, more focused cars. Chevrolet is their bread and butter brand, yet they sell the least impressive cars of the whole group. Corvette excepted. Frankly I would have focused on Chevy first instead of Saturn.

[racy]

GM sales down, Toyota up.

I am getting sick of this song. Just once, I'd like to read GM up, Toyota down. Just once...that's all I am asking for. If GM doesn't followup and goes back to the crapper, I don't care. But just once, I'd like to read GM up, Toyota down.

....wondering if I will not read that headline until MY2009, when the Volt hits the showroom floors.

[vxl]

Mark LaNeve must be the most optimistic guy on the planet. He keeps spouting this spin as every month GM's sales get worse. I'm afraid GM's finished.

[throwback]

Originally Posted by tgagneguam

If GM hadn't dropped the ball, if they designed their family sedans as well as foreign brands have done in some cases for the better part of two decades, GM very well could differentiate the Saturn Aura, the Chevrolet Malibu, the Pontiac G6, and the Buick LaCrosse and could be enjoying similar success. Already there are people who buy a Buick that wouldn't buy a Pontiac, there are folks who drive a Chevrolet who would never buy a Saturn. Differentiated where they need to be differentiated and commonized where they could be commonized, there's definitely a place for all four vehicles you mention to do well. In fact, I think GM could actually capitolize on economies of scale, again, if they had their act together.

Saying that they're failing because they're too many models comes across as a cop out to me; it excuses sub-par to average work.

You made my case better than I did. Sad to say I don't think GM is capable of making those cars different enough for them to be successful. GM has been a truck company for so long they can't seem to work any magic on the car side. Look at the G5 and Cobalt. I think the reason why Cadillac has turned around is precisely because their cars are so focused. No need to differentiate a CTS for a Buick for example.

[racy]

Originally Posted by Buick61

Can we call the Aura a flop and just move on?

Good question: But let's define "move on".

GM's historical definition has been, to let it rot on the vine, and discontinue. I am not for this style, and believe it to be a major part of GM's woes. They don't stick with anything.

GM's philosophy is "If at first you don't succeed, quit". If GM were a football team, their offensive strategy would be "First down, then punt".

If however, we define "move on" to be "keep the name to build recognition, immediately look where we're going wrong and correct the faults", then I am all for it.

[SmallBlock]

Let's rename the board GMOverreaction.com.

Once again, it's big picture time.

What's the major event coming up? Anybody? Anybody? Bueller?

Oh yeah, that's right. UAW negotiations. Go take a look at historical GM sales rates and overlay it with the UAW contract cycle.

When did the Employee discount thing happen? I bet you don't remember that it was the year AFTER they signed the last agreement. Why would you want to massively boost sales (and give the UAW a major plank to stand on) when your raison-d'etre is to finally get the monkey off your back?

And don't give me this crap about GM not being able to a damn thing to control sales. This market is driven almost entirely by gasoline prices and cash on the hood. Look at the vehicles with the highest incentives.

So, what we have here is most likely a case of GM not playing the incentive game, which ends up being a win-win-lose scenario for them.

WIN Lower incentives help resale values in the long term and boost profits.

WIN Sales are lower, which going to the negotiations with a severely crippled UAW is a good thing long-term (the end of the anachronism).

LOSE Short term sales are off, leading to much fretting and general unease by the media and stock markets.

Long term gains will always outweigh short term loss in my books.

Please resume your whining. Don't forget to genuflect in front of the chrome mushroom.

[tgagneguam]

Originally Posted by racy

Good question: But let's define "move on"....

If however, we define "move on" to be "keep the name to build recognition, immediately look where we're going wrong and correct the faults", then I am all for it.

This would be my preference for the definition of move on. I think this is how the Company rights itself in the long-run. Short-term, little-chance-for-success solutions like cutting names, cutting vehicles, cutting divisions, retreating to more comfortable niches (i.e., ones where Detroit is the only real competitor) sounds really nice superficially, I suppose, but it largely explains why we're treated to declining sales reports month after month, year after year. You'd think after decades of following the old script they'd see it needs to be rewritten.

[SmallBlock]

Originally Posted by nsap

Yup. It's a FLOP. For God's sake, the ION out-sold it! Sadly its not a product-related flop, its a MARKETING flop. Pathetic.

Actually, I've come to the conclusion that the Saturn Aura is the acid test on GM's resolve to think long-term.

In the past, whether a vehicle's marketing campaign performed or failed, it didn't really matter. That creative agency was usually still rewarded with the business. Look at Campbell-Ewald and how long they've stuck around.

It wasn't like that with the Aura. The agency that came out with the initial advertising (or lack there of) was fired within 6 months of launch. The press release actually said due to their poor performance.

THAT, ladies and gentlemen, is not your usual GM. Upper managment is POed about the lack of execution on the Marketing front concerning that car, and what happened was a bit of a wake up call.

Watch the Aura, and GM's decisions concerning it. Things are happening that we haven't seen from Old Blue before.

[tgagneguam]

Originally Posted by SmallBlock

Let's rename the board GMOveraction.com.

Once again, it's big picture time.

What's the major event coming up? Anybody? Anybody? Bueller?

Oh yeah, that's right. UAW negotiations. Go take a look at historical GM sales rates and overlay it with the UAW contract cycle.

When did the Employee discount thing happen? I bet you don't remember that it was the year AFTER they signed the last agreement. Why would you want to massively boost sales (and give the UAW a major plank to stand on) when your raison-d'etre is to finally get the monkey off your back?

And don't give me this crap about GM not being able to a damn thing to control sales. This market is driven almost entirely by gasoline prices and cash on the hood. Look at the vehicles with the highest incentives.

So, what we have here is most likely a case of GM not playing the incentive game, which ends up being a win-win-lose scenario for them.

WIN Lower incentives help resale values in the long term and boost profits.

WIN Sales are lower, which going to the negotiations with a severely crippled UAW is a good thing long-term (the end of the anachronism).

LOSE Short term sales are off, leading to much fretting and general unease by the media and stock markets.

Long term gains will always outweigh short term loss in my books.

Please resume your whining. Don't forget to genuflect in front of the chrome mushroom.

The even larger picture is that Detroit has been retreating for the past 2.5 decades. While the responses are generally to this month's sales, I think the tenor of the conversation reflects the fact that the news has been the same for so long, despite the fact that you suggest it's much more orchestrated in the mid-term and many people just don't get it like you do (wink, wink, nudge, nudge).

[tripowergto]

Originally Posted by SmallBlock

Let's rename the board GMOverreaction.com.

Once again, it's big picture time.

What's the major event coming up? Anybody? Anybody? Bueller?

Oh yeah, that's right. UAW negotiations. Go take a look at historical GM sales rates and overlay it with the UAW contract cycle.

When did the Employee discount thing happen? I bet you don't remember that it was the year AFTER they signed the last agreement. Why would you want to massively boost sales (and give the UAW a major plank to stand on) when your raison-d'etre is to finally get the monkey off your back?

And don't give me this crap about GM not being able to a damn thing to control sales. This market is driven almost entirely by gasoline prices and cash on the hood. Look at the vehicles with the highest incentives.

So, what we have here is most likely a case of GM not playing the incentive game, which ends up being a win-win-lose scenario for them.

WIN Lower incentives help resale values in the long term and boost profits.

WIN Sales are lower, which going to the negotiations with a severely crippled UAW is a good thing long-term (the end of the anachronism).

LOSE Short term sales are off, leading to much fretting and general unease by the media and stock markets.

Long term gains will always outweigh short term loss in my books.

Please resume your whining. Don't forget to genuflect in front of the chrome mushroom.

Thank you for sharing some sense with the sky is falling crowd.

[SmallBlock]

Originally Posted by tgagneguam

While the responses are generally to this month's sales, I think the tenor of the conversation reflects the fact that the news has been the same for so long, despite the fact that you suggest it's much more orchestrated in the mid-term and many people just don't get it like you do (wink, wink, nudge, nudge).

Apparently Goldman Sachs has greater information on what's really going on. But since the tenor of the conversation is so negative, they must be mistaken by upgrading such a dog. I guess they also just don't get it (Wink, Wink, Nudge, Nudge).

Goldman Upgrades GM On Likely Concessions During Upcoming UAW Negotiations
Posted on Jun 26th, 2007 with stocks: GM

http://transport.seekingalpha.com/article/39345

Look. GM's probably only got one shot to massively improve their labor costs. The UAW has never been in this weak of a state before. You don't jeopardize that by laying huge incentives down in a market almost entirely dictated by cash on the hood. One month of good sales this close to negotiations is as good as a year.

What's more important to GM? 6 months of good sales, or reducing your labor costs and associated burdens permanently?

I hope you'd choose the latter. Two winks, three nudges.

[saturnsteve]

The Aura is not a flop. And I dont understand why it does not sell better than it does.

[racy]

Originally Posted by saturnsteve

The Aura is not a flop. And I dont understand why it does not sell better than it does.

FLOP doesn't necessarily mean its a bad car. It merely means it is not selling.

Contrast with the the Pinto which was a bad car, but sold well. Pinto was a flop in terms of product, not sales.

And then there's the Aztek. It was a bad car and it didn't sell well. It was a flop in sales and product.

[uujjj]

the aura needs a 4-cyl (which it will get next year)

people need to stop going nuts over monthly sales.